Faculty Scholarship Highlight, January 2013

One of the hot-button issues in contemporary patent law is the law governing “standards-essential” patents—those patents involved in the setting of industry-wide technical standards, such as protocols for wireless communication; electronic file formats; and so on. Because different products made by different manufacturers need to comply with these standards, most of which are developed in relatively open and informal industry groups, the holders of standards-essential patents are in a particularly powerful position vis-à-vis their competitors. And although these patents themselves are subject to a unique series of regulations, some of which are privately imposed by the relevant industry group, and others of which are the result of antitrust and competition laws, they continue to provoke substantial (and high-stakes) litigation in contexts in which the existing rules are inadequate to resolve disputes. That’s where American University Washington College of Law Professor Jorge Contreras comes in. As he explains, his recent work draws analogies between patents developed by open industry groups and “patent pools”— a structure in which competitors in the same technological field agree to license their patents covering a particular technology (such as the MP3 or DVD file formats) collectively, and benefit proportionately from the revenue generated by licensing that technology within the industry. Using the evolution of private rules to govern patent pools as a precedent, Contreras aims to demonstrate how the lessons from that evolution could also be applied to open industry standards, with the hopeful endgame being a more comprehensive regime of private—and mutually beneficial—rules and a reduction in the costly and time-consuming patent litigation that currently affects the marketplace.